By Shayne Munger
Yesterday, with much fanfare, the Bush administration lowered its estimate of this year's federal budget deficit to $296 billion. So instead of the substantial increase from last year's $318.3 billion deficit that the administration and other forecasters predicted a few months ago, the 2006 deficit will fall by 7 percent, according to the new projection.
"Tax relief is working (My note: This is crap!!!). The economy's growing. Revenues are up. The deficit is down," Bush said.
Bush noted that the projected $296 billion deficit would be about 2.3 percent of the gross domestic product, and he likened it to a mortgage that could be easily borne by a homeowner with a rising income. (My note: What rising income?? "When the economy expands, our nation's income goes up and the burden of the deficit shrinks," he said.
"We have experienced a neck-wrenching swing from large surpluses to large deficits since the start of the decade," said Maya MacGuineas, president of the Committee for a Responsible Federal Budget, a bipartisan group.
"Only Washington Republicans would think a $300 billion deficit is good news," ~Senate Minority Leader Harry M. Reid
In the past six years, the net share of the national debt for 99 percent of Americans has jumped by more than $7,000 per person, CTJ reports. The latest round of tax cuts signed into law in May are being paid for entirely with borrowed money and will balloon the national debt, including amounts owed to the Social Security Trust Fund, by $3 trillion this fiscal year alone, CTJ reports. That's in addition to about $15,000 owed by every American, including the rich, in 2000.
Says CTJ Director Robert S. McIntyre:
A tax cut paid for with borrowed money is just a deferred tax increase or program cut, with interest. The vast majority of Americans are worse off now than before President Bush's tax cuts were enacted. Only the very rich are net winners.
Everyone, except the richest 1 percent, will have to pay for this debt, either through spending cuts or future tax hikes. According to CTJ's analysis:
From 2001 to 2006, 99 percent of U.S. residents received an average tax break of $2,616, but their added debt burden rose by $9,782 per person, leaving an additional net debt of $7,166 per person.
Because the benefits of the Bush tax cuts have gone primarily to the wealthiest 1 percent, this small group still comes out ahead even after the added debt burden is factored in. For the wealthiest 1 percent, who have an average 2006 income of $1,272,000, the tax breaks outweigh the added debt burden by a "net"average of $30,352 per family member.- Advertisement -
The increase in tax receipts over the past couple of years absolutely DOESN"T show that the tax cuts are working. Although revenue has increased in 2005 and 2006 with the hefty boost in corporate profits and incomes of Americans at the top tax brackets, but after adjusting for inflation and growth in population, tax revenue hasn't grown overall during Bush's presidency.
Bush and the Republicans keep saying that the economy is great because the unemployment figure is at around 4.8%. This is just more of this Administration's misleading ploys to try to make the situation seem rosy. Most people don't realize that this is all smoke and mirrors. This figure represents "only" workers that are drawing unemployment. The Labor Department doesn't take into account all the millions of people that have had their unemployment benefits run out and are still without a job. These people are still looking or have just given up on finding employment. The Department also doesn't take into consideration all those millions of workers who have lost high paying jobs and have been forced to take either part-time or minimum wage jobs because there are no good jobs available in their field or require their high skill level.